"They gotta pay!" Shirey states at the first meeting Wednesday of the 2013 Sacramento City Management Academy.

"Police patrol officers do not pay their pension share. These are hard times! Most [city] employees are paying their share of pensions with the city paying its employer share," Shirey comments.

He says if police patrol officers pay their share of pension costs -- projected to be $5 million -- it will substantially reduce the city's current $9 million budget deficit.

At the start of the long-term recession, Shirey says the city entered into five-year contracts with labor unions.

During the past six years, Shirey points out the drastic reduction in property values, coupled with declining sales tax income, caused the current structural deficit because city expenditures exceed projected income.

"My job is to get these two lines [income versus expenditures] back together."

"This is manageable," Shirey believes, "but will take courageous decisions by the city counsel to bring cost factors under control."

Specifically, Shirey cites the police department's under-funded pension as well as escalating health care costs for city employees and retirees -- along with increased employee salaries -- as major factors creating the $9 million budget deficit.

According to Shirey, Sacramento has a $1 billion annual budget, which currently lacks $9 million to pay expenditures.

"We used up reserve funds... we eliminated 1,300 city jobs. "We've gone through rough times since 2008, and the recession hit California pretty hard.

"Sacramento is not immune from this economic downturn!" explains the city manager.

Adding to Sacramento's financial woes, payment of skyrocketing health care costs for post-retirement city employees was promised. According to Shirey, the city "never set aside a dime" to cover these spiraling costs.

"There's no money in a fund to pay these costs," he states, adding, "We've got to do something!"

The solution?

"We've got to get people back to work! Sacramento is a government-driven economy, which is too narrow."